With the growing market of real estate, it is not uncommon for people to purchase more than one residential unit or empty plot as a means of future investment. If you are planning to do this, you do not necessarily need to sell the first property. With a loan against property, you can finance the purchase of your new house with minimum hassle. Listed below is the detailed application procedure for such a loan.
How to apply for a loan against property for a new house
A loan application process can be intimidating for first-time applicants. Thankfully, the procedure to avail of a loan against property is a simple process, regardless of your purpose for this form of credit. Here are some of the steps that you must follow to enjoy a hassle-free loan application and approval process.
- Step 1 – Start by selecting a lender of your choice. Several financing companies offer LAPs to eligible candidates. However, terms and conditions tend to vary between these lenders. Compare the offered credit and choose according to your needs and repayment capabilities.
- Step 2 – Visit the NBFC’s website and start the mortgage loan application procedure online; you can also contact them directly to begin offline loan application. Today, most lenders and borrowers prefer the former method because it is faster and tends to minimize hassle for both parties involved.
- Step 3 – Fill up a loan application form, taking the time to verify each detail. Make sure this application does not include errors, as they can reduce your loan approval chances.
- Step 4 – A loan against the property process is incomplete without proper documentation to support your application. Enquire about these documents beforehand and ensure you have everything handy during the loan application procedure.
- Step 5 – Once the form fill-up and documentation is complete, submit your application to the lender for verification and approval.
- Step 6 – After submission, wait for application approval. With an online application, the approval is almost instantaneous these days. If, on the other hand, you submitted your application offline, the financing company may take a few days to verify your details and get back to you.
- Step 7 – Wait for the loan disbursal and check your account when the money is credited to verify the amount. It usually takes 4 to 5 business days.
What documents are needed for the loan?
One of the other things that you should know before opting for a loan against property to buy a house is the documents needed for it. Here is a complete list of what you may need.
- Documents to prove your identity, for instance, Voter ID, PAN Card, Aadhaar Card, etc.
- Address proof in the form of Voter ID, Aadhaar Card, Passport, etc.
- Salaried employees need to provide salary slips and Income Tax returns to prove their income.
- Bank statements are necessary to avail of the loan as well. Those working for a private, government or public organization need to submit the last 3 months’ bank statements. However, self-employed people need to provide the bank statement for the last 6 months.
- Property documents are mandatory when availing of a loan against property. The registration and deed for the house are some of your property papers needed for this credit.
Additional documents are necessary for some lenders. Enquire about the same before loan application to avoid any confusion.
Is opting for a loan against property to buy a new home the right move?
There are many myths surrounding loan against property. However, you need to learn the facts about such credit before deciding whether it is the right step for you.
When buying a new house, the property loan makes perfect sense. With a long tenor and a substantial loan limit, you have the perfect opportunity to invest in your dream home.
Furthermore, if the loan repayment becomes too burdensome, you can always sell the first property to recover the money and clear the debt. You would still have the new property to act as your permanent residence after such a move.
Companies provide pre-approved offers to make availing Loan Against Properties easier and quicker. These offers are also available for a range of other products, namely home loans, business loans, education loans, and more. You can check your pre-approved offers by providing your mobile number and name.